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Reputational Bidding

Francesco Giovannoni and Miltiadis Makris

Bristol Economics Discussion Papers from Department of Economics, University of Bristol, UK

Abstract: We consider auctions where bidders care about the reputational effects of their bidding and argue that the amount of information that is disclosed at the end of the auction will influence bidding. Our analysis focuses on several bid disclosure rules that capture all of the realistic cases. We show that bidders distort their bidding in a way that conforms to stylized facts about takeovers/licence auctions. Also, we rank the disclosure rules in terms of the expected revenues they generate and find that, under certain conditions, full disclosure will not be optimal.

Keywords: Auctions; signaling; disclosure. (search for similar items in EconPapers)
JEL-codes: D44 D82 (search for similar items in EconPapers)
Pages: 50 pages
Date: 2014-06
New Economics Papers: this item is included in nep-cta and nep-mic
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Citations: View citations in EconPapers (2) Track citations by RSS feed

Published in International Economic Review.

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Journal Article: REPUTATIONAL BIDDING (2014) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:bri:uobdis:14/641

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